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2014: The year ahead

With 2013 coming to a close, vendors and operators in the telecoms industry are sharing their thoughts and predictions about what 2014 may hold. Chief among the forecasts is a rise in the role that M2M services will play in the industry next year.

Among those betting on M2M in 2014 are Mobeen Khan, executive director of product marketing for advanced mobility solutions and business solutions at AT&T. “Although M2M is currently the domain of niche developers, next year, AT&T predicts that more developers will begin experimenting in markets away from its traditional use in fleet management, utilities and construction,” he said.The firm expects that in 2014, growth will be seen in South East Asia and Latin America for both local M2M deployments and its use in supply chain tracking.

AT&T added that while companies currently deploying M2M are looking for a return on investment, they are also balancing profit against the need to protect data from hackers. As a result, and especially as more LTE devices are supporting M2M, security and the ability to quickly stream data are likely to be important in future development efforts.

The firm predicts that devices will be more widely connected than ever before, and said that technology that might have seemed outlandish a few years ago, such as wearable devices, is now making it into mainstream use. “The technology is improving all the time and this has major implications for us as consumers, everything from the way we buy and consume goods, to how we heat our homes or book our car in for its next service. The number of connected devices is expected to grow to 25 billion by 2020,” said David Akka, UK MD at Magic Software.

And echoing AT&T’s concerns about security, Akka believes that the public needs a ‘safety first’ stance.

“This has always been a fine balance to strike and one which reached heightened levels of awareness in the public consciousness this year, following the Prism scandal. With more devices connected to the internet, the impact is rippling out: in the wake of allegations that the US government had secretly accessed users’ data without the company’s knowledge Yahoo has announced that it is to encrypt users’ data. “

“This is an issue which won’t go away in 2014 as we increasingly rely on our mobile devices for everything from banking to storing and sharing sensitive corporate data. We’re likely to see new innovations in this field with start-ups that can enable us to communicate in a way that no-one can infiltrate. This comes as the public are starting to realise that we do, perhaps, pay a price for ‘freemium products’ and that protecting our privacy comes with a price tag attached.”

Industry consultancy Northstream also shared its forecast that 2014 will see 50 per cent subscriber penetration of LTE services in multiple European markets. Operators’ revenue from media consumption will enjoy its peak year, the firm added.

“Given the widespread availability and maturity of LTE infrastructure and devices, European operators have a solid staging post to push for LTE,” said CEO and co-founder Bengt Nordstrom. “Northstream believes 2014 will be the year in which this drive will occur. The result of these efforts will see LTE subscriber share in a significant number of European markets reach nearly 50 per cent.”

However, in the long term, operators will lose out as consumers select different, platform independent, online media providers, rather than being tied to a fixed set of predefined content packages, for their content demands.

Northstream also expects NFC to become a relevant mobile technology for consumers in 2014. However, this will be driven forward by retailers offering mobile loyalty cards, as opposed to operator-driven financial services.

“Over the last few months, OS providers and device vendors have introduced innovations and new approaches that will change the NFC landscape. For example, Google opened the Android API to allow developers to fully use NFC and let any Android app communicate with Point of Sale (POS) devices over NFC,” added Nordstrom.

“Northstream predicts that mobile loyalty cards will be the first set of applications to benefit from these aforementioned innovations. With operator dependencies removed; retailers can create their own apps and deploy local NFC mobile loyalty solutions that work with existing POS infrastructure. This can happen without the coordination of other ecosystem players.”

In markets where there is a dominant mobile operator, it is likely that the industry will begin to see wholesale LTE networks being launched, according to Chris Buist, director at spectrum auction consultancy Coleago. Buist believes wholesale LTE networks will be launched to address concerns the operator has regarding the roll out of rural mobile broadband coverage and to assist with the ability to allocate spectrum fairly.

“Due to the public private partnership between the government and Korea Telecom it is expected that Rwanda will be the first to launch in 2014,” he said. “Kenya and Mexico are also considering public private partnerships so it is possible that they will follow Rwanda’s lead in launching their own wholesale LTE networks in 2015. Some commercial operators may also go down the wholesale LTE route. However, it is unlikely that these will be in the forthcoming year.”

Network function virtualisation (NFV) and software defined networking (SDN) became hot topics in the industry during 2013. According to Bart Salaets, service provider solution architect at F5 Networks, we can expect to see the first commercial NFV deployments targeting a few very specific use cases, such as virtualized value-added services and optimisation services on the mobile data plane.

“We expect that there will be an increase datacentre and cloud investment from service providers as they obtain more and more IT infrastructure to support their services,” Salaets added.

Ciena’s EMEA CTO David Tomalin added that 2014 will be the year SDN does “less talking and more walking” – particularly to enhance the efficiency and new service creation promise of NFV.

“Integral to a number of next generation network incubation projects in 2013, the next 12 months see the next step from incubation to operation, structured within two to three year rollouts program. In 2014, we also expect the ONF continue to make progress on OpenFlow as the Optical Transport support in OpenFlow becomes available.”

The increasing pressure to improve financial metrics and deliver better rates of return means that over 2014 SDN and NFV will be increasingly pivotal in business proposals, Tomalin added.

“The SDN ecosystem will start to take shape, allowing organisations to simplify their network and improve capital efficiency and OPEX over the long term. More than ever, embracing open SDN and planning for its effective deployment will be integral to attaining success.”

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